3 Reasons to Sell Research In Motion Today

A sputtering economy, implosions at financial institutions, or just plain bad management -- on any given day, investors can name a number of reasons to sell a stock. Yet while panic never benefits investors, it's good practice to play devil's advocate with our investments from time to time.

In Motley Fool CAPS, more than 120,000 members have weighed in on more than 5,400 stocks, sharing bullish and bearish opinions alike.

In the case of Canadian mobile email king Research In Motion (Nasdaq: RIMM  ) , a total of 4,658 members have weighed in on its chances of success. I've already plucked out some of the bullish rationale backing Research In Motion today, so here are three counterpoints to consider, courtesy of CAPS:

1. Falling behind
In an intensified smartphone market, some investors are concerned about RIM's increased spending for new devices and its ability to bring products to market on time. Steve Jobs gleefully pointed out that Apple's (Nasdaq: AAPL  ) iPhone sales the past quarter were 6.9 million compared, to 6.1 million BlackBerry sales. Apple's and Google's (Nasdaq: GOOG  ) application stores are already live, while Research in Motion's own storefront won't be up and running until March 2009.

2. Changing market
Competition from the iPhone and smartphones from Nokia (NYSE: NOK  ) and Motorola (Nasdaq: MOT  ) is dropping prices and creating margin issues in RIM's space. The company once owned the market and brought in steady profits. Now it needs to work harder and spend more to win over consumers by competing on price, features, and fashion. Even Hewlett-Packard (NYSE: HPQ  ) is getting in the smartphone market.

3. The party's over
Research In Motion has brought huge returns to investors over the past decade, but like other huge companies such as Oracle (Nasdaq: ORCL  ) , it's not very likely to reach 10-bagger status from this point forward. Believing its best days of growth behind it, some investors think it's best to move on to better opportunities in smaller companies.

Of course, Research In Motion has survived and thrived despite dozens of obstacles. But whether the company can continue to do so is a whole different question. That's why CAPS is such a great resource to augment your own analysis.

To see what the very best CAPS members are saying now about Research In Motion, just click on over to Motley Fool CAPS and have a look -- it's all free, and your opinion's welcome.

Further skeptical Foolishness:

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The Motley Fool Stock Advisor service looks for companies like Apple, with strong management poised to beat the market over the long haul. To see all the stocks that have helped Tom and David Gardner beat the market by 29 points on average, take a free 30-day trial.

Fool contributor Dave Mock can do threesies no problem -- anything beyond foursies is another story. He owns shares of Motorola. Nokia is an Inside Value selection. Google is a Rule Breakers pick. Apple is a Stock Advisor recommendation. The Fool's disclosure policy will go door to door to get its message out.


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Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 30, 2008, at 11:24 PM, cruzn59 wrote:

    Motley Fool, you guys are so busy being behind on info you can't do you jobs well. The two articles about rimm and the anti-rimm was, as usual, a waste of time written with gleaned info from articles from other sites. You should have been all over the credit default swaps instead of playing games with really money. You are cute and funny anymore, this is the last place to go to get useful info to live in the markets like a pro. Do something that is new and creative and helpful, and you will bring readers in and they will stay.

  • Report this Comment On November 03, 2008, at 11:41 AM, TMFCop wrote:

    krr711,

    Oh you mean like these articles on credit default swaps?

    http://www.fool.com/investing/general/2008/01/18/10-question...

    http://www.fool.com/investing/general/2008/02/14/swaps-sink-...

    http://www.fool.com/investing/dividends-income/2008/05/27/th...

    Good idea! As for the pro/con RIMM articles, it's often useful for the investor to have a concise summation of the benefits and disadvantages of owning a stock presented in a cogent format. Not every investor is as sophisticated in the world of investing as you present yourself to be.

    I find them to be an excellent launching pad for further research as I'm sure others do too.

    Rich

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